P&O Princess investors may try to stall meeting

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The Independent Online

Major investors in P&O Princess Cruises, the UK cruise line operator in the throes of a takeover battle, were yesterday considering whether to table a motion to postpone an extraordinary shareholders' meeting scheduled for 14 February.

Major investors in P&O Princess Cruises, the UK cruise line operator in the throes of a takeover battle, were yesterday considering whether to table a motion to postpone an extraordinary shareholders' meeting scheduled for 14 February.

Shareholders hope that a further delay would allow a friendly merger proposal with Royal Caribbean to run alongside a £3.5bn hostile takeover offer from Carnival Corporation, thereby keeping Princess's options open should either bid be blocked by the regulators.

One senior UK fund manager said the revised 500p-a-share offer from Carnival "provided grounds for the meeting to be delayed further".

While postponing the meeting to November ­ beyond which Royal Caribbean's merger agreement lapses ­ would allow anti-trust authorities in Europe and the US to pass judgement on both deals, legal confusion reigns over whether the meeting can be delayed further without the risk of Royal Caribbean walking away.

Under the terms of the deal struck with Royal Caribbean, Princess must hold the EGM "as soon as possible". Princess had initially scheduled the meeting for early January, but bowed to pressure from Carnival to extend it to mid-February. Last night, all three parties were divided on whether the meeting could be adjourned.

Sources close to Royal Caribbean said it was "extremely likely the company would walk away from the deal" unless a vote was taken on 14 February. However, analysts said the intense battle being fought to woo Princess suggests that the UK company is in a very strong position. Princess's shareholders were yesterday split on whether its board should talk to Carnival. The board has said it will consider Carnival's revised offer in detail and is expected to make an announcement before the London Stock Exchange opens on Monday.

Tim Rees, a fund manager at Clerical Medical, which owns 1.1 per cent of Princess, urged the board to consider the options. "The revised offer from Carnival clearly requires serious consideration from P&O's board as to whether it merits discussion," he said. However, Tony Nutt, at Jupiter Asset Management, which holds 3.5 per cent of Princess, said: "Even at this price, [Carnival's offer] is not enough."

After rising to a record high of 416p, Princess's shares closed down 9p at 400p.

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